There's little doubt that stress kills creativity. Here is what happens to our minds when we experience stress.
Stress blocks freedom: Stress fills our mind with anxiety and worry. This prevents the brain from wandering freely and thinking out-of-the-box.
Stress causes tunnel-vision: When we are stressed, our brain focuses only on the problem at hand. This reduces our ability to see things from multiple perspectives, which lowers our ability to think creatively.
Stress changes the structure of the brain: Long-term stress literally changes our brain! The size of the amygdala, the part that processes fear information, increases and the temporal lobe and the hippocampus shrink. The hippocampus is vital for creativity, long-term memory, and imagination.
So stress impacts our mind and creativity in very real ways.